LIZ: THE REDDIT REBELS HAVE A
NEW TARGET, DISNEY CEO BOB CHAPE
K, SHAREHOLDERS TAKING
TO REDDIT IN A THREAT CALLED
UNHAPPY WITH THE CURRENT STATE
OF DISNEY PARKS AND THEY ARE
TRYING TO DEVICE A PLAN TO VOTE
OUT THE CEO AT THIS YEAR’S
ANNUAL MEETING.
THE SHAREHOLDERS IN A THREAD ARE
OUTRAGED AT THE MOUSE HOUSE CEO
FOR SOARING PRICES AT THE THEME
PARKS, LONG LINES AND DECLINING
CUSTOMER SERVICE, WITH ONE USER
WRITING, "THE MAGIC IS GONE."
THIS , AS THE HAPPIEST PLACE ON
EARTH, IS SET TO RELEASE ITS
QUARTERLY REPORT AFTER THE
CLOSING BELL THE STOCK IS
MOVING HIGHER BY 3%, DISNEY
ESTIMATED TO HIT AN EPS OF $0.63
AND $20.91 BILLION IN REVENUE.
LET’S BRING IN CFRA RESEARCH
SENIOR ANALYST TUNA AMOBI WHO
SLATED CO FOUNDER AND EXECUTIVE
WHICH IS A FILM PACKAGING AND
FINANCING SITE.
GREAT TO HAVE YOU BOTH ALL RIGHT
, TUNA GO FOR IT.
WHAT ARE YOU EXPECTING HERE AND
WHAT IS THE MOST-IMPORTANT THING
CHAPEK HAS TO DO TO CALM
PEOPLE OUT THERE AND DO YOU PUT
ANY CRUDE ENSEMBLE INTO THIS
REDDIT WEBSITE THAT SAYS
THIS GUYS GOTTA GO.
>> UM, GOOD AFTERNOON, LIZ.
NO, I THINK REALLY, ITS BEEN A
BAPTISM OF FIRE OF SORTS FOR BOB
CHAPEK.
HE HASN’T HAD AN EASY RIDE AT
ALL.
IT SEEMED LIKE THE PANDEMIC
REALLY THREW A MAJOR CURVE BALL
AT HIM.
I WOULDN’T QUITE FRANKLY PUT A
LOT OF CREDENCE ON WHAT’S GOING
ON WITH THE REDDIT CROWD.
I KNOW EVERYONE WANTS TO HEAR
SOME OF THESE, YOU KNOW,
GOVERNANCE BUT WHAT’S DIFFERENT
NOW IS THAT YOU’VE GOT A PRETTY
NEW CEO WHOSE TRYING TO GET HIS
HANDS-ON THE BALL.
STREAMING IS GOING TO BE A HUGE
PART OF THE OUTLOOK AND HOW
INVESTORS PERCEIVE THIS NAME.
I THINK WE’VE SEEN SOME OF THE
OTHER PLATFORMS THAT
REPORTED RAISING SOME CONCERNS
ABOUT THE DECELERATION IN THE
SECULAR GROWTH OUTLOOK FOR
STREAMING.
WE THINK THAT THOSE CONCERNS ARE
OVERDONE.
THAT BEING SAID, I THINK THE
EXPECTATIONS FOR THIS
QUARTER THAT DISNEY IS
GOING TO REPORT ARE VERY VERY
TEMPERED.
I WOULD LOOK TO THE BACK HALF OF
THE FISCAL YEAR, FOR SOME TYPE
OF REACCELERATION, SO IF YOU’RE
A DISNEY SHAREHOLDER, OBVIOUSLY,
YOU’RE NOT PLEASED WITH THE WAY
THE STOCK IS UNDERPERFORMED OVER
THE LAST COUPLE YEARS, BUT ON
THE POSITIVE SIDE, YOU KNOW,
YOU’VE GOT SOME OF THE MAJOR
TRADITIONAL BUSINESSES REALLY
GAINING SOME TRACTION COMING OUT
OF THE PANDEMIC.
WE KNOW THE THEME PARKS HAS BEEN
REALLY GETTING A LOT OF THE
BENEFIT OF SIGNIFICANT
PENT-UP DEMAND AND I’M TALKING
ABOUT THE CRITICISM AGAINST BOB
CHAPEK.
THE PRICING POWER IS REALLY
THROUGH THE ROOF IF YOU’RE A
THEME PARK CUSTOMER YOU’RE
REALLY FEELING THAT PAIN BUT
THAT’S A GOOD THING, IF YOU’RE
AN INVESTOR BECAUSE THAT REALLY
SHOWS THAT THERE’S A LOT OF
PEOPLE OUT THERE WAITING TO GET
BACK TO THE THEME PARKS, AND
THAT BUSINESS, AS YOU KNOW, LIZ,
TOOK A MAJOR MAJOR HIT, SO WHEN
YOU BALANCE EVERYTHING OUT,
WE’RE STILL KIND OF PLEASED.
IT’S KIND OF STILL TOO EARLY TO
MAKE A DEFINITIVE CALL OUT THERE
THIS IS A MARATHON, AND NOT A
SPRINT, SO THAT’S WHY WE CANNOT
HAVE A BUY RECOMMENDATION RIGHT
NOW.
LIZ: WELL BECAUSE WE’RE STILL,
YOU KNOW, SEEING AFTER EFFECTS
OR THE EFFECTS OF THE PANDEMIC.
STEPH, CLEARLY TUNA IS A
BELIEVER IN DISNEY.
HERE IS WHERE THE PROBLEM COMES.
YES, THEY HAVE SOME MOMENTUM
BEHIND THEIR STREAMING ALTHOUGH
IT SLOWED DOWN IN THE LAST
QUARTER.
I LOOK AT THIS AND I SAY, THEY
HAVE TOO MANY MASTERS TO DEAL
WITH AND TO PLEASE, WHEN IT
COMES TO CONTENT.
THEY’VE GOT THE STREAMING
BUSINESS, WHICH IS REALLY HUNGRY
FOR GREAT CONTENT, BUT THEY
STILL HAVE THEIR LINEAR LEGACY
BUSINESS.
THEIR CHANNELS OUT THERE, DISNEY
CHANNEL, FX, AND ESPN, THEY HAVE
TO FILL THAT WITH CONTENT AND
PEOPLE ARE CORD CUTTING SO HOW
DO YOU SQUARE THE TWO,
ESPECIALLY CONSIDERING THAT EACH
LET’S SAY DISNEY, YOU KNOW,
GROUP OF CHANNELS OUT THERE, THE
OLD LINEAR CABLE AND
SATELLITE BUSINESS, IS ABOUT $17
PER SUBSCRIBER YET IT’S JUST
6.99 PER SUBSCRIBER FOR DISNEY
PLUS.
>> WELL, I THINK THERE’S MUCH
TO DO ABOUT NOTHING HERE AND I
DON’T REALLY FOCUS EVER ON THE
SHORT-TERM EARNINGS.
I LOOK JUST AT THE MACRO PICTURE
, SO FIRST OFF, JUST LIKE
WHEN TIM COOK TOOK OVER FROM
STEVE JOBS.
THAT WAS A VERY BIG ACT TO
FOLLOW AND SAME THING HERE IS
FOLLOWING BOB IGER, WAS NO EASY
TASK AND TAKING OVER WHEN THE
PANDEMIC HIT WAS HERCULEAN
EFFORT.
I THINK OVERALL HE’S DONE A
REALLY GOOD JOB ALL THINGS
CONSIDERED.
NOW, REGARDING DISNEY’S STREAM
ING PROSPECT, THIS IS
STILL ALL ABOUT A HIT-DRIVEN
BUSINESS AND THE BEAUTIFUL THING
IS THAT UNLIKE NETFLIX DISINTO
IT IS HIGHLY DIVERSIFIED WITH
THEIR REVENUE LINES.
THEY GOT THEIR THEME PARKS, YES
MAYBE THERE’S PRICING ISSUES
THERE BUT AGAIN, THEY OWN THAT
MARKET, AND THEY CAN RAISE THE
PRICES, AND THEY ALSO HAVE
BOX OFFICE.
THEY’RE GOING TO BE RELEASING
BLACK PANTHER, THEY ARE GOING TO
BE RELEASING ANOTHER THOR,
THERE’S A DR. STRANGE, ANOTHER
PIXAR MOVIE.
THEY HAVE A LOCK ON MAJOR IP
FRANCHISES HITTING THE
BOX OFFICE THIS YEAR, ALL OF
WHICH CAN GO INTO THEIR STREAM
ING PLATFORM, SO I THINK
ULTIMATELY, THE NAME OF THE GAME
IS IF YOU CAN GENERATE HITS ON A
QUARTERLY OR MORE-FREQUENT
BASIS YOU’LL KEEP DRAWING
AUDIENCES IN WHETHER IT’S STREAM
ING OR BOX OFFICE, DISNEY
IS THE BEST AT THIS.
LIZ: TUNA, WE’RE LOOKING AT THE
WAY THEY DO DRAW PEOPLE IN.
THEY’VE GOT THE GREAT FRANCHISES
WITH STAR WARS AND MARVEL;
HOWEVER, WHEN YOU LOOK AT THE
STREAMING, THEY’VE GOT ALL OF
THOSE PEOPLE NOW.
THEY’VE GOT ALL OF THOSE
CUSTOMERS.
HOW DO YOU GET THE CUSTOMER THAT
LIKES THE CONTENT, THAT’S OUT
THERE SAY ON NETFLIX, THE
BRIDGERTON OR ANYTHING,
YOU COULD LOOK AT SQUID GAME OR
WHAT WAS THE CHESS ONE?
MY FAVORITE, KOBRA KAI.
THEY DON’T HAVE THAT STUFF YET.
THAT’S A GREAT QUESTION, LIZ.
WHAT I LIKE ABOUT THE STRATEGY
AT DISNEY IS REALLY ADOPTED HERE
, IS CALL IT A FOUR QUARTER
STRATEGY, SO WHEN YOU KIND OF
LOOK AT DISNEY PLUS PLATFORM, I
THINK THEY REALLY DONE A GREAT
JOB TO KIND OF PUT IN CONTENT
THERE, THAT APPEALS TO US BROAD
AUDIENCE DEMOGRAPHIC IS POSSIBLE
AND THAT’S REALLY THE PLAYBOOK
HERE THAT WE SEE A
LOT OF STREAMERS TRYING TO ADOPT
NOW IT’S ALSO A GOOD IDEA TO
HAVE NICHE AND DIFFERENTIATED
CONTENT BUT ULTIMATELY, IF YOU
WANT TO BE SUCCESSFUL IN THIS
GAME, YOU’VE GOT TO HAVE
CONTENT THAT APPEALS TO A VERY
WIDE AUDIENCE, NOT JUST
INTERNATIONALLY AND ALSO NOT
JUST THE U.S. BUT ALSO
INTERNATIONALLY.
ONE OF THE THINGS THAT DISNEY
HAS EMPHASIZED AS THEY CONTINUE
TO LAUNCH GLOBALLY IS THE IDEA
TO REALLY INVEST HEAVILY IN
LOCAL AND REGIONAL CONTENT, AND
THEY HAVE LIKE LITERALLY
HUNDREDS OF SHOWS OF LOCAL AND
REGIONAL CONTENT IN THE PIPELINE
, AS WE SPEAK, SO
WHICH IS WHY THEY KIND OF TALK
ABOUT DOUBLING THE AMOUNT OF
CONTENT THEY HAVE THIS FISCAL
YEAR, AND YOU CAN LOOK FOR THAT
SPENDING TO HIT NORTH OF
$10 BILLION IN A COUPLE YEARS
FROM LITERALLY 2 BILLION, SO
THIS IS A HUGE UNDERTAKING AND
IT’S REALLY NOT FOR THE FAINT AT
HEART, AND I THINK INVESTORS
UNDERSTAND THAT DISNEY IS ON A
MUCH VERY DIFFERENT TRAJECTORY
COMPARED TO NETFLIX, WHICH TOOK
A MUCH LONGER TIME TO GET TO
THEIR FIRST HUNDRED MILLION AT A
MUCH FASTER PACE BUT YOU’RE
LIKELY TO FIND SOME SPEED BUMP
AND THAT’S REALLY WHAT THE TRICK
HAS BEEN LATELY.
LIZ: I’M RUSHING YOU ALONG
BECAUSE STEPH, WE ONLY GOT A FEW
SECONDS BUT WHAT IS THE BIGGEST
BLOCKBUSTER THAT WILL COME OUT
THIS YEAR THAT WILL REALLY HELP
DISNEY?
>> I MEAN, ON THEATRICALITY
COULD BE BLACK PANTHER OR DR.
STRANGE AND WE ALL SAW HOW
SPIDERMAN JUST PERFORMED BUT
ALSO ON THEIR STREAMING SERVICE
OB-1 FOR SURE IS A HUGE
DRAW.
LIZ: OKAY GREAT TO SEE YOU BOTH,
TUNA, STEPH, GREAT TO HAVE YOU
WE’LL BE WATCHING FOR DISNEY BUM
MERS AFTER THE BELL.